Posts Tagged ‘Consumer Metrics Institute’

Anyone with a modicum of ‘sense on cents’ is well aware of the maxim ‘garbage in, garbage out.’

If we are to believe that the inflation data reported by Uncle Sam does not properly capture the true level of price increases in our economy — did somebody say intentionally misleading — then the immediate question begs, what is the real level of economic activity in the nation?

A measure of economic growth from one period to another expressed as a percentage and adjusted for inflation (i.e. expressed in real as opposed to nominal terms). The real economic growth rate is a measure of the rate of change that a nation’s gross domestic product (GDP) experiences from one year to another.

If inflation is under reported, and the rate of change in our economic growth is a known figure, then by definition the output (that is, real GDP) will be overstated. So I repeat my question: What is the real level, that is a more honest and accurate assessment, of our 1st quarter GDP? (more…)

Ultimately people vote their pocket book. To that end, this upcoming election should be very, very interesting.

A full three plus years after the onset of our supposed recovery and our economy remains plugged into Ben Bernanke’s life support. The European drag on the global economy is not going away anytime soon. In fact, if exacerbated the European fiasco may very well cause our own economy to fall back into recession.

After having highlighted Rick Davis’ work at Consumer Metrics Institute in my morning commentary, I reached out to him and received the following MUST READ fabulous response.

If you care to truly learn what is going on with the American consumer as we collectively navigate the economic landscape, sit down, take notes, save this review, and share it with your friends. In terms of cutting edge, real time, unbiased economic analysis and commentary it does not get better than this.

THANK YOU, Rick!!

Larry:

We go to great lengths to remove from our data both the inexorable shift of consumers from brick-and-mortar to on-line and the impact of price inflation. (more…)

Economic data is typically released and then reviewed in aggregate fashion. As such, understanding the dynamics at work within our economy is often clouded by the inability to access and analyse ‘the trees’ as opposed to ‘the forest.’ What happens as a result of this reality? Economic programs to address issues are typically crafted while looking through the rear view mirror. Regrettably results generated are often sub-standard and fraught with unintended consequences.

We have commented before about how the “Great Recession” has changed character over time, evolving from a relatively normal “garden variety” and V-shaped consumer confidence recession into something far more persistent — where a lack of jobs and negative home equity has transformed it into a “new frugality.” But we haven’t previously discussed how the “Great Recession” has been an uneven experience among even those living in “Main Street” America. A recent review of our data has convinced us that this has not been a recession of shared pain, but one that has cut much deeper in some demographics than in others. (more…)

Economics is the most inexact of sciences. As much as we may think we can understand our future economic landscape based upon the study of the past, a variety of twists, turns, and unknown challenges inevitably come upon us. This reality has never been more prevalent than in our ‘Uncle Sam’ economy circa 2010. Do not think for a second that the ‘grand wizards’ in Washington currently undertaking the massive financial experiment throughout our economy do not appreciate this. They do. They just would not admit it.

Can we look toward private enterprises in an attempt to ‘see through’ the Washington smoke and mirrors? In fact we can. I make no bones about my admiration for the work of Rick Davis at Consumer Metrics Institute. As Rick so boldly states, the work at CMI is focused on:

“Bringing the measurements of critical economic activities into the twenty-first century by mining tracking data for an understanding of what American consumers were doing yesterday.”

Well, what were our fellow Americans doing yesterday and the days before that? (more…)

Are you scratching your head wondering about the title of this commentary? Are you wondering if I inadvertently mistyped and should have written CPI for Consumer Price Index? Is it possible that I meant to write PPI for Producer Price Index? Am I somehow opining on a new found capability of the fabulous GPS navigation devices? A resounding no to all of the above.

I have been a big proponent of the work produced by Rick Davis of Consumer Metrics Institute. Recall that Rick captures real-time internet related discretionary consumer purchases to measure the overall health and pulse of our economy. As much as some may question the correlation of Rick’s work and the economic reports released by the crowd in Washington, I am a big fan of his work. I strongly encourage people to follow him. Why do I broach this topic?

Do you trust our Washington establishment to provide real truth and display unquestioned integrity in our economic releases? You don’t? Neither do I. Aside from monitoring Rick’s work, are there other broad based, independent vehicles with which we can measure economic data? (more…)

I have informed more people than I care to count that I do not believe we are going to have an economic double dip. Am I turning positive on the economy? Do I see blue skies and fair winds on our economic horizon? No, regrettably not. The reason I do not believe we will have an economic double dip is very simply I do not believe that our “real” economy, not the government sponsored version, ever really came out of the initial recession.

People may care to debate or challenge me on my premise, but my ‘sense on cents’ leads me to believe that we have been experiencing one long and ongoing recession. I definitely sense that more people are now coming to accept this reality as well. This ‘walking pneumonia’ economic syndrome is captured in a recent commentary by Rick Davis ofConsumer Metrics Institute,

The “Great Recession” that began in 2008 has had many nuances, but among the most important are that many of the observed changes in consumer behavior have begun to linger, much as the recession itself now appears to have done. If a new consumer thrift paradigm becomes endemic — either because of natural demographic processes or scarred generational memories of upside-down loans — the lingering recession might well end up being measured in years, not quarters as commonly expected. (more…)

Do you increasingly feel that you are not receiving the full story in terms of our overall economy? Do you feel as if the ‘political class’ in Washington is speaking a different language than the ‘working class’ in the rest of the country? Do you scratch your head as to why economic releases are often immediately panned and quickly thereafter revised? (Case in point, the initial release of 2nd quarter GDP on July 30th was quickly thereafter projected to be halved.) For all of the above reasons, more and more Americans are relying on independent economic research and analysis. Two of my favorites in this camp (aside from Sense on Cents, of course!!) are John Williams of Shadow Government Statistics and Rick Davis of Consumer Metrics Institute.

That began a lengthy process of exploring the history and nature of economic reporting and in interviewing key people involved in the process from the early days of government reporting through the present.

For a number of years I conducted surveys among business economists as to the quality of government statistics (the vast majority thought it was pretty bad), and my results led to front page stories in the New York Times and Investors Business Daily, considerable coverage in the broadcast media and a joint meeting with representatives of all the government’s statistical agencies. Despite minor changes to the system, government reporting has deteriorated sharply in the last decade or so. (LD’s emphasis) (more…)

When I see any economic data addressing consumer retail activity, I immediately think of Rick Davis and his fabulous work at Consumer Metrics Institute. On that note, and given yesterday’s strong upward move in the market driven largely by a positively perceived ICSC report, I went straight to the source and asked Rick for his thoughts. I had the following exchange today:

Rick,
Any quick comments or thoughts on the report released by the ICSC? I
know that the report captures same store sales which makes for a big
disqualification and is not properly captured but any thoughts you may
have are always deeply appreciated.
Thanks.
Larry (more…)